How to Get the Most Bang from Your Bank

How to Get the Most Bang from Your Bank Tips for College Students

1. Most banks offer four types of accounts: checking, savings, money market, and certificates of deposit. A checking account is a must for college students. A savings account is a good idea if you receive student loan money or financial aid money in a lump and will be using it over the course of the semester, or even if you just want to tuck away a little money for emergencies. Make your money work a little harder for you by choosing an account that will pay interest.
2. With a checking account, you can get an Automated Teller Machine (ATM) card, which gives you instant access to your cash. Choose a bank that gives you unlimited free ATM access without any fees.
3. Some banks offer a special kind of ATM card, called a debit card, which you use to make purchases instead of using cash or a check. Using debit cards saves the expense of having checks printed and can help you control your spending. They're convenient, there are no fees, they give you instant access to your money, and they limit your spending to what you actually have in your account. This is a good thing.
4. Guard your debit card carefully, and don't leave it lying around. Some debit cards require only a signature instead of a PIN number when making a purchase. If you have this kind of card and it gets into the wrong hands, someone could forge your signature and steal your money.
5. Some banks offer free checking to students, so ask around before setting up an account. Call or visit several banks, ask about their student checking accounts, and get a list of fees, interest rates, and branch locations so you can make the choice that best suits your needs.
6. When choosing a bank, ask about fees. Some banks charge a flat monthly fee for checking accounts, some charge a fee only if your account drops below a certain minimum balance, and others charge a fee for each check you write or each deposit you make. Choose the best account based on your personal situation and how you intend to use the account. For example, if you write lots of checks, you'll want an account that has a flat fee; if you write very few, it may be cheaper to pay for each check.
7. Some checking accounts pay interest, but usually require a higher minimum balance. If you're going to have low balances at certain times of the month, it might be cheaper to pay a flat fee in order to have an account with a lower minimum balance.
8. As soon as you arrive on campus, decide on a bank and set up an account so you'll have access to your money without having to pay transfer fees from home.
9. If you're unsure how to balance your checkbook each month, record ATM transactions, or write checks, ask the bank staff to show you how. A good understanding of these activities can prevent you from making costly mistakes.
10. If you use an ATM card to access your bank account, plan ahead so you can avoid incurring ATM fees at out-of-network ATMs. Why pay money to access your own funds?
11. Don't use the ATM to check your balance or review recent transactions unless you're sure your bank doesn't charge a fee for this service. Most banks provide other methods for you to check this information, either online or through an automated telephone system.
12. If you don't have enough money in your bank account to cover a check you've written, the check will bounce (be returned by the bank for insufficient funds) and your bank will charge you a fee of $25 to $35. If you wrote the check out to a business, they'll add their fee to the bank's, for a total of up to $100 or more. To prevent this, balance your checkbook, record all your ATM withdrawals and debit card transactions, record any automatic deductions, and double-check your math in your check register.
13. Sign up for overdraft protection; then resolve not to use it except to cover you when you make an error in your checkbook. You'll be protected from bouncing checks when you do make a mistake, so you'll avoid fees for insufficient funds, which usually start at $25 per check.
14. Balance your checkbook every month. Banks do make errors. More likely, though, you'll make an error in your checkbook or forget to deduct an ATM withdrawal. Balancing your checkbook can help prevent any nasty surprises and overdrawn accounts resulting in yet more fees.
15. When balancing your checkbook, be sure to add any interest you earned to your checkbook register balance and deduct any fees so your checkbook register is always up to date. Even being off a dollar can result in bounced checks.
16. You've heard the dumb blond joke: "I can't be overdrawn on my bank account. I still have checks left!" Just because you have checks doesn't mean you have money in your account, so keep your checkbook register up to date and know how much you have in your account before writing a check, using your debit card, or making a withdrawal.
17. When writing a check, fill in all of the blank spaces and draw a line through the blank unused portion. Write the check amount as a number in the box provided, and spell it out on the long line below. These precautions will help prevent your check amounts from being altered.
18. Always sign your checks as you write them. Never sign a blank check. If you make a mistake, write "VOID" in large letters across the check or shred it so nobody else will be able to use it. Note the voided check in your checkbook register and write a new one to replace the one you voided.
19. Don't use an easy-to-guess personal identification number (PIN) for your ATM, like your birthday or part of your phone number or social security number. If you lose your card, it will be very easy for someone to drain your bank account if they can easily guess your PIN.
20. Never give your bank account number or other information printed on your checks to anyone over the phone. They can use the information to fraudulently remove money from your account by submitting what's known as an electronic (paperless) check.
21. Question your bank's fees. They may seem like small potatoes, but they're big business for banks. If your bank charges a fee for a certain service, make sure it's something you really need, even if it's only a few dollars a month.
22. If your bank charges you to talk to a live teller, change banks. Originally, ATMs were supposed to save banks money by letting you do simple banking without using a live teller; then banks started charging fees to use the ATM. Now some banks are charging a fee if you use a live teller. Never pay a fee to access your own money.
23. Online banking makes it easy to keep your checkbook register up-to-date because you can quickly scan the recent activity in your account and spot any ATM withdrawals or debit card purchases you forgot to record. Don't rely solely on your online balance, though, because checks you've written may not have cleared yet, so your balance is rarely what shows up online.
24. Don't pay bank fees for check printing. Your bank will give you a small supply of starter checks. Order additional checks from a discount check printer for a fraction of the cost. Try Checks Unlimited (www.checksunlimited.com) at 1-800-204-2244, Checks in the Mail (www.checksinthemail.com) at 1-800-733-4443, or CheckWorks (www.checkworks.com) at 1-800-9714223.
25. Avoid using nonbank ATMs whenever possible. Scammers sometimes install scanning devices in ATMs that track your PIN and account numbers. The scammers then remove all the money from your account.
26. Never write your PIN number in a conspicuous place or give the number out to anyone. It's like giving them a license to steal from you.
27. Make sure you know whether your bankcard is a debit card or a credit card. They're used interchangeably, but when you use your debit card, the money comes out of your checking account right away. If you're not aware of this, you could overdraw your account and incur a bank fee.
28. Debit cards are a great way to control your spending without carrying a lot of cash around with you, because you can only spend what you have in your checking account. This prevents the build-up of credit card debt and interest expense.
29. Just because your bank account balance shows you have enough money available to cover checks you've written or are about to write doesn't mean you won't bounce a check. Ask your bank how long they hold deposited checks before the funds are actually available to you, and then plan accordingly when writing checks or using your debit card. This will help you avoid bounced checks or overdraft fees.
30. If you bounce a check, and you've never done it before, call your bank and ask them to waive the fee. Many banks will do this for your first offense. A quick phone call is worth the potential $25 to $39 savings.
31. If you've used your credit card responsibly for at least a year, call your credit card company and ask them to lower the interest rate. Many will do so.
32. If your bank merges with or is bought by another bank, call and ask about any changes in fees and policies. You'll probably receive notices stuffed in the envelope with your bank statement, but you could easily throw these away without being aware that the bank merger could be costing you money in additional fees or higher interest rates.
33. Be sure to transfer money from your savings account to your checking account before using your debit card. If your accounts are linked, your bank may charge a fee to make this transfer for you when your checking balance is too low to cover the debit charges.
34. Keep your money in the bank, not in your pocket. It's too easy to spend impulsively when you have easy access to cash.
35. Stay away from check-cashing stores. Their fees take a bite out of your budget.
36. Take advantage of the magic of compounding. Money saved in an interest-bearing account will grow more quickly because you earn interest on both the principal and the previously earned interest. The more frequently the compounding is performed, the more money you'll end up with. Over time the difference can be significant, so don't hide your cash under your mattress or in the cookie jar.
37. Keep close tabs on the whereabouts of your ATM card and report a lost or stolen card to your bank immediately. If you report the card missing before it's used without your permission, you'll be protected against unauthorized withdrawals.
38. Before setting up a bank account in your college town, find out if there's an on campus credit union. You may get better deals on interest rates and loans, pay lower fees, and earn higher interest on deposits.
39. Bounced checks not only result in costly fees, they can show up in your credit report and may make it difficult for you to open a checking account in the future. Banks don't like customers with a history of bouncing checks.
40. By federal law, your liability for unauthorized use of your bankcard is limited to $50 if you report your card's loss within two business days, and $500 if you report the card's loss within more than two but less than 60 days. If you discover your card is missing, don't hesitate to report it.
41. "Free" checking often comes with a hidden price. The money you leave in your account to meet the minimum balance requirements for free checking could be earning interest in an interest-bearing account. If your minimum balance requirement for free checking is more than a five hundred dollars, check around for a better deal.
42. If you use a debit card, it's easy to lose track of the exact balance in your checking account unless you record the debits in your checkbook register immediately. Dipping below the minimum balance in your checking account, even for a day, can result in bank fees.
43. Don't write checks unless you have money in your checking account to fully cover them. The days of getting "float" on your money (the gap between the time you mail your payments and the time they clear your bank account) are gone, and e-checks are here to stay. Merchants send an electronic copy of your check to the bank instead of mailing it, so your checks clear much more quickly.
44. When choosing a bank, look for one that doesn't charge a fee to use any ATM or that reimburses you for fees charged by an ATM owned by another bank. This is a convenient perk because you won't have a limited number of ATMs that you can access free.
45. When choosing a bank, also compare the minimum balance requirements (if your balance falls below the minimum for even one day, you'll be charged a fee), availability and location of ATMs, hours of operation and convenient locations, availability of online banking, whether the bank pays interest on the balance in your checking account, and whether the bank is FDIC-insured.
46. If you bounce a check, be sure to record the vendor's bounced check fee and your bank's fee in your check register. Otherwise, you could get into a vicious circle of bouncing more checks and incurring additional fees.
47. Avoid using ATMs not in your bank's network. You could incur what's known as double-dipping fees, where you're charged a fee by a bank that's not in your network and a surcharge by your own bank on top of that. This can cost you as much as $4 just to withdraw a little cash from your account.
48. A little advance planning can help you avoid ATM fees. Use a debit or check card when you make purchases at stores and get cash back at the same time, instead of withdrawing cash from the ATM and incurring a fee.
49. Banks often lower fees for customers who use direct deposit, so sign up for direct deposit on any checks you receive regularly, like paychecks. Even if you already have a no-fee account, direct deposit will save you time and protect you from having your checks stolen.